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Subject: Polity

  • [pib] Sabki Yojna Sabka Vikas Campaign

    The Government has launched ‘Sabki Yojna Sabka Vikas’ campaign for inclusive and holistic preparation of the Gram Panchayat Development Plan (GPDP).

    Sabki Yojna Sabka Vikas

    • Under Article 243 G of the Constitution, Panchayats have been mandated for the preparation and implementation of plans for economic development and social justice.
    • Thus, Panchayats have a significant role to play in the effective and efficient implementation of flagship schemes/programs on subjects of national importance for transforming rural India.
    • The objectives of the campaign broadly include strengthening of elected representatives and Self-Help Groups, evidence-based assessment of progress made.
    • The campaign aimed to help Gram Panchayats (GPs) in preparation of convergent and holistic GPDP through the identification of sectoral infrastructural gaps in respective areas.

    Back2Basics: Gram Panchayat Development Plan (GPDP)

    • The Gram Panchayats are constitutionally mandated for the preparation of GPDP for economic development and social justice utilizing resources available with them.
    • The GPDP should be comprehensive and based on a participatory process involving the community particularly Gram Sabha.
    • It will be in convergence with schemes of all related Central Ministries / Line Departments related to 29 subjects listed in the Eleventh Schedule of the Constitution.

  • Disruption of Parliament

    Context

    Last week, a newspaper reported that the government is considering curtailing the monsoon session of Parliament on account of disruptions.

    Reasons for disruptions

    • In 2001, a day-long conference was held in the Central Hall of Parliament to discuss discipline and decorum in legislatures.
    • The inputs of participants of conference helped identify four reasons behind the disorderly conduct by MPs.
    • Inadequate time: The first was dissatisfaction in MPs because of inadequate time for airing their grievances.
    • Unresponsive attitude: The second was an unresponsive attitude of the government and the retaliatory posture of the treasury benches.
    • Adherence to norm: The third was political parties not adhering to parliamentary norms and disciplining their members.
    • Lack of action: The absence of prompt action against disrupting MPs under the legislature’s rules.

    Suggestions

    • Enforcement of a code of conduct for MPs and MLAs: The Lok Sabha has had a simple code of conduct for its MPs since 1952.
    • Newer forms of protest led to the updating of these rules in 1989.
    • Accordingly, members should not shout slogans, display placards, tear away documents in protest, play cassettes or tape recorders in the House.
    • A new rule empowers the Lok Sabha Speaker to suspend MPs obstructing the Houses’ business automatically.
    • But these suggestions have not been enforced so far.
    • Increase in working days: As recommended by the 2001 conference, there should be an increase in the working days of Parliament.
    • The conference had also resolved that Parliament should meet for 110 days every year and larger state legislative assemblies for 90 days.
    • Successive governments have shied away from increasing the working days of Parliament.
    • Our legislature should meet throughout the year, like parliaments of most developed democracies.
    • The concept of opposition days: In the United Kingdom, where Parliament meets over 100 days a year, opposition parties get 20 days on which they decide the agenda for discussion in Parliament.
    • The main opposition party gets 17 days and the remaining three days are given to the second-largest opposition party.
    • Canada also has a similar concept of opposition days.
    • This can also be done in India.

    Conclusion

    More strengthening of our Parliament is the solution to prevent disruption of its proceedings. It is the only mechanism to ensure that disrupting its proceedings or allowing them to be disrupted ceases to be a viable option.

  • Surveillance and human rights

    Context

    The Pegasus revelations reflect an attack on Indian democracy and Indian citizens.

    Role of government in protecting the fundamental and human rights of citizens

    • The surveillance of the target group in India through Pegasus raises doubts about the functioning of democracy in India.
    • Constitutional duty of government: The government has a constitutional duty to protect the fundamental and human rights of its citizens, irrespective of who they are.
    • There is clear evidence that the rule of law has been undermined.
    • More evidently, this reflects extremely poor governance.
    • The Intelligence Bureau, the Research and Analysis Wing, and the National Security Council Secretariat should have forewarned the government and citizens against such surveillance seriously violating privacy and fundamental rights.
    • The Supreme Court, in K.S. Puttaswamy v. Union of India (2017), declared privacy a constitutionally protected value.

    Violation of human rights

    • India is a signatory to the Universal Declaration of Human Rights.
    • Article 12 provides that everyone has the right to the protection of the law against arbitrary interference with his privacy, family, home or correspondence.
    • The International Covenant on Civil and Political Rights, also signed by India, in Article 17 states, “No one shall be subjected to arbitrary or unlawful interference with his privacy, family, home or correspondence, nor to unlawful attacks on his honour and reputation. Everyone has the right to the protection of the law against such interference or attacks.”
    • In K.S. Puttaswamy, the Supreme Court noted India’s commitments under international law and held that by virtue of Article 51 of the Constitution, India has to endeavour to “foster respect for international law and treaty obligations…”
    • The Protection of Human Rights Act, 1993 is a fallout of this commitment.

    Recommendations on digital communication technologies

    • The annual report of the United Nations High Commissioner for Human Rights (UNHCHR) in 2014 made recommendations on “digital communications technologies”.
    • Judicial oversight: The UNHCHR report stated, judicial involvement that meets international standards can help to make it more likely that the overall statutory regime will meet the minimum standards that international human rights law requires.
    • At the same time, the report stated that judicial involvement in oversight should not be viewed as a panacea.
    • Independent body: The report also recommended an independent oversight body to keep checks.
    • Effective remedy to victim: The International Covenant on Civil and Political Rights requires states parties to ensure that victims of violations of the Covenant have an effective remedy.
    • Role of business: The report also dealt with the role of businesses and stated that when a state requires that an information and communications technology company provide user data, it can only supply it in respect of legitimate reasons.
    • Earlier, due to concerns of member states, the General Assembly adopted Resolution 68/167 affirming that rights held by people offline must also be protected online.
    • The resolution also called upon all states to respect and protect the right to privacy, including in digital communication.

    Conclusion

    Indians have a right to call upon NSO to terminate the agreement, if any, with the Indian government or any private player and to cooperate with citizens to unravel the truth.

  • Preventive detention a necessary evil: Supreme Court

    Preventive detention, the dreaded power of the State to restrain a person without trial, could be used only to prevent public disorder, the Supreme Court held in a judgment.

    What is Preventive Detention?

    • Preventive detention means detaining a person so that to prevent that person from commenting on any possible crime.
    • In other words, preventive detention is an action taken by the administration on the grounds of the suspicion that some wrong actions may be done by the person concerned which will be prejudicial to the state.

    PD in India

    A police officer can arrest an individual without orders from a Magistrate and without any warrant if he gets any information that such an individual can commit any offense.

    • Preventive Detention Law, 1950: According to this law any person could be arrested and detained if his freedom would endanger the security of the country, foreign relations, public interests, or otherwise necessary for the country.
    • Unlawful Activities Prevention Act (UAPA) 1968: Within the ambit of UAPA law the Indian State could declare any organization illegal and could imprison anyone for interrogation if the said organization or person critiqued/questioned Indian sovereignty territorially.

    What is the difference between preventive detention and an arrest?

    • An ‘arrest’ is done when a person is charged with a crime.
    • In the case of preventive detention, a person is detained as he/she is simply restricted from doing something that might deteriorate the law-and-order situation.
    • Article 22 of the Indian Constitution provides protection against arrest and detention in certain cases.

    Rights of an Arrested Person in India

    A/c to Article 22(1) and 22(2) of the Indian constitution:

    • A person cannot be arrested and detained without being informed why he is being arrested.
    • A person who is arrested cannot be denied to be defended by a legal practitioner of his choice. This means that the arrested person has right to hire a legal practitioner to defend himself/ herself.
    • Every person who has been arrested would be produced before the nearest magistrate within 24 hours.
    • The custody of the detained person cannot be beyond the said period by the authority of magistrate.

    Exceptions for Preventive Detention

    Article 22(3) says that the above safeguards are not available to the following:

    • If the person is at the time being an enemy alien
    • If the person is arrested under certain law made for the purpose of “Preventive Detention”

    Constitutional provision

    • It is extraordinary that the framers of the Indian Constitution, who suffered most because of the Preventive Detention Laws, did not hesitate to give Constitutional sanctity.
    • B.R. Ambedkar was of the opinion that the freedom of the individual should not supersede the interests of the state.
    • He had also stated that the independence of the country was in a state of inflancy and in order to save it, preventive detention was essential.

    Issues with preventive detention

    • Arbitrariness: The police determinations of whether a person poses a threat are not tested at a trial by leading evidence or examined by legally trained persons.
    • Rights violation: Quiet often, there is no trial (upto 3 months), no periodic review, and no legal assistance for the detained person.
    • Abuse: It does not provide any procedural protections such as to reduce detainees’ vulnerability to torture and discriminatory treatment, and to prevent officials’ misusing preventive detention for subversive activities.
    • Tool for suppression: In the absence of proper safeguards, preventive detention has been misused, particularly against the Dalits and the minorities.

    What has the apex court recently rule?

    • Preventive detention is a necessary evil only to prevent public disorder.
    • The court must ensure that the facts brought before it directly and inevitably lead to harm, danger or alarm, or feeling of insecurity among the general public or any section thereof at large.
    • The State should not arbitrarily resort to “preventive detention” to deal with all and sundry “law and order” problems, which could be dealt with by the ordinary laws of the country.
    • Whenever an order under a preventive detention law is challenged, one of the questions the court must ask in deciding its legality is: was the ordinary law of the land sufficient to deal with the situation?
    • If the answer is in the affirmative, the detention order will be illegal.

    Upholding the Article 21

    • Preventive detention must fall within the four corners of Article 21 (due process of law) read with Article 22 (safeguards against arbitrary arrest and detention) and the statute in question, Justice Nariman ruled.
    • The Liberty of a citizen is a most important right won by our forefathers after long, historical, and arduous struggles.

    Conclusion

    • The constitutional philosophy of personal liberty is an idealistic view, the curtailment of liberty for reasons of State’s security; public order, disruption of national economic discipline, etc.
    • They are envisaged as a necessary evil to be administered under strict constitutional restrictions.
    • India is a large country and many separatist tendencies against the national security and integrity existed and existing and a strict law is required to counter the subversive activities.
    • The number of persons detained in these acts is not a very large and due attention is made before preventive detention.
    • Having such kind of acts has a restraining influence on the anti-social and subversive elements.
    • The state should have very effective powers to deal with the acts in which the citizens involve in hostile activities, espionage, coercion, terrorism, etc.

  • Pakistan grants statehood to Gilgit-Baltistan

    Pakistan has finalized draft legislation to incorporate Gilgit-Baltistan, the region known before 2009 as Northern Areas, as a province of the country.

    Gilgit-Baltistan: History of the region

    • Gilgit was part of the princely state of Jammu & Kashmir but was ruled directly by the British, who had taken it on lease from Hari Singh, the Hindu ruler of the Muslim-majority state.
    • When Hari Singh acceded to India on October 26, 1947, the Gilgit Scouts rose in rebellion, led by their British commander Major William Alexander Brown.
    • The Gilgit Scouts also moved to take over Baltistan, which was then part of Ladakh, and captured Skardu, Kargil and Dras.
    • In battles thereafter, Indian forces retook Kargil and Dras in August 1948.

    Accession with Pakistan

    • In November, 1947, a political outfit called the Revolutionary Council of Gilgit-Baltistan had proclaimed the independent state of Gilgit-Baltistan.
    • It declared GB was acceding to Pakistan only to the extent of full administrative control, choosing to govern it directly under the Frontier Crimes Regulation.
    • It was a law devised by the British to keep control of the restive tribal areas of the northwest.
    • Following the India-Pakistan ceasefire of January 1, 1949, Pakistan entered into an agreement with the “provisional government” of “Azad Jammu & Kashmir”.
    • Much of its parts had been occupied by Pakistani troops and irregulars and were later taken over by Pak defence and foreign affairs.
    • Under this agreement, the AJK government also ceded administration of Gilgit-Baltistan to Pakistan.

    Not being incorporated as a province

    • In 1974, Pakistan adopted its first full-fledged civilian Constitution, which lists four provinces —Punjab, Sindh, Balochistan and Khyber Pakthunkhwa.
    • Pakistan-Occupied Kashmir (PoK) and Gilgit-Baltistan were not incorporated as provinces.
    • One reason ascribed to this is that Pakistan did not want to undermine its international case that the resolution of the Kashmir issue had to be in accordance with UN resolutions that called for a plebiscite.
    • In 1975, PoK got its own Constitution, making it an ostensibly self-governed autonomous territory.
    • This Constitution had no jurisdiction over the Northern Areas, which continued to be administered directly by Islamabad (the Frontier Crimes Regulation was discontinued in 1997)
    • In reality, PoK too remained under the control of Pakistani federal administration and the security establishment, through the Kashmir Council.

    Reasons behind

    • The main difference was that while the people of PoK had rights and freedoms guaranteed by their own Constitution, which mirrors the Pakistan Constitution.
    • However the people of the minority Shia-dominated Northern Areas did not have any political representation.
    • Although they were considered Pakistani, including for citizenship and passports, they were outside the ambit of constitutional protections available to those in the four provinces and PoK.

    Why GB is in focus now?

    • Pakistan began considering changes to its administrative arrangements with increasing Chinese involvement in strategic development ventures.
    • GB was vital to those projects, given that it provides only land access between the two countries.
    • Since 2009, it has had a namesake legislative assembly.

    Suppression of a movement

    • There is anger against Pakistan for unleashing sectarian militant groups that target Shias, but the predominant sentiment is that all this will improve once they are part of the Pakistani federation.
    • There is a small movement for independence, but it has very little traction. Some factions argue for its accession with India.
    • While some reports have suggested that Pakistan’s decision is under pressure from China, wary that Gilgit-Baltistan’s ambiguous status might undermine the legality of its projects there.

    Significance for India

    • Gilgit-Baltistan is an integral part of India by virtue of the legal, complete and irrevocable accession of Jammu & Kashmir to the Union of India in 1947.
    • The area’s strategic importance for India has increased in light of the China-Pakistan Economic Corridor agreement.
    • India is also concerned of a two-front war (with China as well as Pakistan) after the standoff in Eastern Ladakh last year.

  • Tamil Nadu legislature turns 100

    The Assembly chambers at Fort St. George, the 17th-century vestige of the colonial era, and Tamil Nadu’s seat of power have completed 100 years of existence.

    Do you know?

    Fort St. George is the first English fortress in India, founded in 1639 at the coastal city of Madras, the modern city of Chennai. The construction of the fort provided the impetus for further settlements and trading activity, in what was originally an uninhabited land.

    Elections in Tamil Nadu

    • Tamil Nadu witnessed elections in November 1920 as a result of the Montagu-Chelmsford Report and the Government of India Act of 1919.
    • The electors included only men, accounting for just 3% of the population.
    • The concept of dyarchy came into being with Ministers, who were Indians, gaining limited control over certain subjects, such as local self-government and education.
    • It was then that the office of the Chief Minister, also called Premier, got instituted.

    Key works accomplished

    • Reservations in public employment: For the first time, caste became the basis for appointment to public services. It took over 70 years for the Central government to follow the principle in its institutions for education and employment.
    • Above 50% cap in reservation: In December 1993, the scheme of 69% reservation for Backward Classes, Most Backward Classes, SCs and STs got legal safeguard. The law was subsequently included in the IX Schedule of the Constitution, through an amendment passed in Parliament, so that its validity could not be challenged.

    Other facts

    • Women’s suffrage: In early 1927, Muthulakshmi Reddy, the well-known medical practitioner and social activist, became the first woman member of the Council and, in no time, became the Deputy President of the Council.
    • Gopuram as an emblem: The symbol features a ‘gopuram’ (temple tower) – characteristic of south Indian temples has been adopted as the state emblem.
    • Change of name: During the two-year rule of the DMK founder C.N. Annadurai, the Assembly, in July 1967, adopted a motion renaming Madras State as Tamil Nadu, which later got the approval of Parliament.
    • Social reforms: It has passed several landmark laws for the welfare of women, such as Devadasi abolition, equal rights to women in property and the constitution of the State Commission for Women.

    Back2Basics: Montagu-Chelmsford Reforms

    Central Legislature thereafter called the Indian Legislature was reconstituted on the enlarged and more representative character.

    • Bicameral legislature: The act set up bicameral legislatures at the centre consisting of two houses- the Council of the States (Upper House) and the Central Legislative Assembly (Lower House).
    • Election and nominations: It consisted of the Council of State consisted of 60 members of whom 34 members were elected and the Legislative Assembly consisted of about 145 members, of whom about 104 were elected and the rest nominated.
    • Separation of power: The central and provincial subjects were demarcated and separated.
    • Diarchy: The Provincial subjects were further divided into Transferred Subjects and Reserved Subjects, the legislative council had no say in the latter.
    • Communal representation: The principle of separate electorate was further extended to Sikhs, Indian Christians, Anglo-Indians and Europeans.
    • Working review: It provided for the appointment of a statutory commission to report the working of the act after ten years.

  • India at 75 is ready for a sedition-less future

    Context

    Chief Justice of India N V Ramana has ignited a passionate debate during a preliminary hearing concerning whether “sedition” should be an offence at all, and how to prevent its misuse or abuse, were it to remain

    Issues with the sedition under Section 124A

    • Against fundamental right: The meandering meanings of expressions such as “disaffection” towards the government, “hatred”, “contempt” etc. constitute an unreasonable restriction on the fundamental right to free expression guaranteed under Article 19(1)(a).
    • Neither the framers of the Constitution nor the authors of the amended Article 19(2) included “sedition” as a ground for “reasonable restriction” to freedom of speech and expression.
    • Colonial past: CJI Ramana in preliminary hearings has pointedly asked the Attorney General whether “sedition under Section 124A of the Indian Penal Code is still required after 75 years of independence from colonial rule.
    • Prone to misuse: The lack of definition of terms used in the section leaves vide the scope for interpretation and thus rampant misuse and abuse.

    Way forward

    • Some law luminaries have found new stirrings of hope in the Supreme Court to strike it down.
    • Find means to prevent misuse and abuse: Alternative way,as the learned attorney general observed is to find constitutional ways and practical means to prevent the abuse and misuse of law.
    • Forbid rampant private complaints:  A most immediate step is to forbid rampant private complaints by citizens and authorise only very senior police officials to take appropriate action.

    Conclusion

    What Gandhiji said — the law may not be used to “manufacture affection” under pain of a penal sanction — was as true then as it remains now. It is high time to realise that the law of “sedition” must go, even when it may strictly not even exist!

  • Explained: Creamy Layer in OBCs

    A proposal to revise the criteria for defining the “creamy layer” among OBCs has been pending for years, and MPs have raised the issue during the ongoing Monsoon Session of Parliament.

    What is the Creamy Layer?

    • Creamy Layer is a concept that sets a threshold within which OBC reservation benefits are applicable.
    • While there is a 27% quota for OBCs in government jobs and higher educational institutions, those falling within the “creamy layer” cannot get the benefits of this quota.

    Basis of Creamy Layer

    • It is based on the recommendation of the Second Backward Classes Commission (Mandal Commission).
    • The government in 1990 had notified 27% reservation for Socially and Educationally Backward Classes (SEBCs) in vacancies in civil posts and services that are to be filled on direct recruitment.
    • After this was challenged, the Supreme Court in the Indira Sawhney case (1992) upheld 27% reservation for OBCs, subject to exclusion of the creamy layer.

    How is it determined?

    • Following the order in Indra Sawhney, an expert committee headed by Justice (retired) R N Prasad was constituted for fixing the criteria for determining the creamy layer.
    • In 1993, the Department of Personnel and Training (DoPT) listed out various categories of people of certain rank/status/income whose children cannot avail the benefit of OBC reservation.
    1. For those not in government, the current threshold is an income of Rs 8 lakh per year.
    2. For children of government employees, the threshold is based on their parents’ rank and not income.
    3. For instance, an individual is considered to fall within the creamy layer if either of his or her parents is in a constitutional post; if either parent has been directly recruited in Group-A; or if both parents are in Group-B services.
    4. If the parents enter Group-A through promotion before the age of 40, their children will be in the creamy layer.
    5. Children of a Colonel or higher-ranked officer in the Army, and children of officers of similar ranks in the Navy and Air Force, too, come under the creamy layer.
    6. Income from salaries or agricultural land is not clubbed while determining the creamy layer (2004).

    What is happening now?

    • MPs have raised questions about the pending proposal for revising the criteria.
    • They have asked whether the provision of a creamy layer for government services only for OBC candidates is rational and justified.

    Has it ever been revised?

    • Other than the income limit, the current definition of the creamy layer remains the same as the DoPT had spelled out in 1993 and 2004.
    • The income limit has been revised over the years.
    • No other orders for the definition of the creamy layer have been issued.
    • While the DoPT had stipulated that it would be revised every three years, the first revision since 1993 (Rs 1 lakh per year) happened only in 2004 (Rs 2.50 lakh), 2008 (Rs 4.50 lakh), 2013 (Rs 6 lakh), and 2017 (Rs 8 lakh).
    • It is now more than three years since the last revision.

    What does the government propose to do about the revision?

    • A draft Cabinet note has stated that the creamy layer will be determined on all income, including salary calculated for income tax, but not agriculture income.
    • The government is considering a consensus on Rs 12 lakh but salary and agriculture income are also being added to the gross annual income.

  • NEET’s All India Quota, and OBC & EWS reservation

    The Union government has approved reservations for the OBC and EWS (Economically Weaker Section) categories within the All India Quota (AIQ) for NEET, the uniform entrance examination for medical and dental colleges across the country.

    What is NEET?

    • The National Eligibility-cum-Entrance Test (NEET) is the entrance examination for entry to all undergraduate (NEET-UG) and postgraduate (NEET-PG) medical and dental courses in the country.
    • Until 2016, the All India Pre-Medical Test (AIPMT) was the national-level entrance examination for medical colleges.
    • State governments used to hold separate entrance tests for seats that were not contested at an all-India level.
    • NEET was held for the first time in 2003, but discontinued the following year.
    • On April 13, 2016, the Supreme Court upheld the newly inserted section 10-D of the Indian Medical Council Act.
    • This provided for a uniform entrance examination to all medical educational institutions at the undergraduate level and postgraduate level in Hindi, English and various other languages.
    • Since then, NEET has been the uniform entrance test for medical courses across the country.

    What is the All-India Quota?

    • Although the same examination is held across the country, a chunk of the seats in state medical/dental colleges is reserved for students domiciled in their respective states.
    • The remaining seats —15% in UG and 50% in PG — are surrendered by the states to the All India Quota.
    • The AIQ scheme was introduced in 1986 under the directions of the Supreme Court to provide for domicile-free, merit-based opportunities to students from any state to study in a good medical college in any other state.
    • A student domiciled in Uttar Pradesh, for example, may be eligible for admission to a seat in a state government medical college in West Bengal, provided she scores high enough in the national merit list.
    • If her score is not high enough for AIQ, she may still hope for admission under the state quota in her home state.
    • In deemed/central universities, ESIC, and Armed Forces Medical College (AFMC), 100% seats are reserved under the AIQ.

    What was the reservation policy followed so far?

    • Until 2007, no reservation was implemented within the All-India Quota for medical admission.
    • On January 31, 2007, in Abhay Nath v University of Delhi and Others, the Supreme Court directed that reservation of 15% for Scheduled Castes and 7.5% for Scheduled Tribes be introduced in the AIQ.
    • The same year, the government passed the Central Educational Institutions (Reservation in Admission) Act, 2007 providing for 27% reservation to OBC students in central government institutions.
    • While state government medical and dental colleges provide reservations to OBCs in seats outside the All India Quota, this benefit was so far not extended to seats allocated under the AIQ in these state colleges.
    • The 10% EWS quota under the Constitution (One Hundred And Third Amendment) Act, 2019, too, has been implemented in central educational institutions, but not in the NEET AIQ for state institutions.

    What led to the decision?

    • The denial of OBC and EWS reservations has been the subject of protests for years.
    • In July last year, the Madras High Court ruled that OBC students too can avail reservation in the AIQ.
    • It held that the reservation could not be implemented for the then academic year for want of time, and can be implemented from 2021-22.

  • Promoting fiscal federalism

    Context

    States are facing financial constraints in the backdrop of lockdown and consequent dwindling revenue collection. The situation also highlights the issues of fiscal federalism in India.

    Issues facing fiscal federalism in India

    1) Issue of 14% compensation

    • As per the Constitution (One Hundred and First Amendment) Act, compensation on account of the implementation of GST will be available for a period of five years.
    • 14% increment assurance: At the time of introducing the Goods and Services Tax (GST) law assured States a 14% increase in their annual revenue for five years (up to July 1, 2020).
    • But the Union government has deviated from the statutory promise and has been insisting that States avail themselves of loans.
    • The future interest liability of these loans should not be placed on the shoulders of the States.
    • Borrowing limits built into loan: Moreover, the borrowing limit of States, as per the Fiscal Responsibility and Budget Management Act, should not be built into these loans.

    2) Conditional increase in borrowing limit

    • Last year, the Union government increased the borrowing ceiling of the States from 3% to 5% for FY 2020-21.
    • But conditions are attached to 1.5% of the 2% of increased ceiling.
    • Attaching conditions for expenditure out of the borrowed amount would clip the wings of the States and goes against the principle of cooperative federalism.

    Way forward

    • Introduce special rate: A special rate could be levied for a specified period in order to raise additional resources to meet the challenges posed by COVID-19 with the approval of the GST Council.
    • As per Section 4(f) of Article 279A, the Union government can consider introducing any special rate to raise additional resources during the pandemic (any natural calamity or disaster).
    • The present GST compensation period will end in 2021-22.
    • Increase the period beyond five years:  Compensation beyond five years requires a constitutional amendment.
    • If this period is not increased, it will create serious financial stress to the States, especially to those which require higher compensation.

    Conclusion

    There is a need for measures on part of the Central government to consolidate fiscal federalism in the aftermath of pandemic and implementation of the GST regime in India.